Groupon, Inc.
Groupon, Inc. (Form: S-1/A, Received: 11/02/2011 14:19:06)
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As filed with the Securities and Exchange Commission on November 2, 2011

Registration No. 333-174661

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



Amendment No. 8
to
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933



Groupon, Inc.
(Exact name of Registrant as specified in its charter)



Delaware   7379   27-0903295
(State or other jurisdiction of
incorporation or organization)
  (Primary Standard Industrial
Classification Code Number)
  (I.R.S. Employer
Identification Number)

600 West Chicago Avenue, Suite 620
Chicago, Illinois 60654
312-676-5773
(Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices)



Andrew D. Mason
Chief Executive Officer
Groupon, Inc.
600 West Chicago Avenue, Suite 620
Chicago, Illinois 60654
312-676-5773
(Name, address, including zip code, and telephone number, including area code, of agent for service)



Copies to:

Steven J. Gavin, Esq.
Matthew F. Bergmann, Esq.
Winston & Strawn LLP
35 West Wacker Drive
Chicago, Illinois 60601
312-558-5600
  David R. Schellhase, Esq.
General Counsel
Groupon, Inc.
600 West Chicago Avenue, Suite 620
Chicago, Illinois 60654
312-676-5773
  Peter M. Astiz, Esq.
Gregory M. Gallo, Esq.
Jason C. Harmon, Esq.
DLA Piper LLP (US)
2000 University Avenue
East Palo Alto, California 94303
650-833-2036



         Approximate date of commencement of proposed sale to the public:     As soon as practicable after this Registration Statement becomes effective.



          If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box.  o

          If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

          If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

          If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

          Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer  o   Accelerated filer  o

Non-accelerated filer  ý (Do not check if a smaller reporting company)

 

Smaller reporting company  o

           The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission acting pursuant to said Section 8(a) may determine.



EXPLANATORY NOTE

        This pre-effective amendment is being filed solely for the purpose of amending "Part II-Information Not Required in Prospectus."

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13.    OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

        The following table sets forth all expenses to be paid by the registrant, other than estimated underwriting discounts and commissions, in connection with this offering. All expenses will be borne by the registrant (except any underwriting discounts and commissions). All amounts shown are estimates except for the SEC registration fee, the FINRA filing fee and the NASDAQ Global Select Market listing fee.

SEC registration fee

  $ 87,075  

FINRA filing fee

  $ 75,500  

NASDAQ Global Select Market listing fee

  $ 250,000  

Printing and engraving

  $ 250,000  

Legal fees and expenses

  $ 2,500,000  

Accounting fees and expenses

  $ 1,500,000  

Transfer agent and registrar fees

  $ 10,000  

Miscellaneous expenses

  $ 1,032,428  
       
 

Total

  $ 5,700,000  
       

ITEM 14.   INDEMNIFICATION OF DIRECTORS AND OFFICERS.

        Section 145 of the Delaware General Corporation Law authorizes a corporation's board of directors to grant, and authorizes a court to award, indemnity to officers, directors and other corporate agents.

        As permitted by Section 102(b)(7) of the Delaware General Corporation Law, or DGCL, the registrant's certificate of incorporation to be in effect prior to the closing of this offering includes provisions that eliminate the personal liability of its directors and officers for monetary damages for breach of their fiduciary duty as directors and officers, except for liability (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for unlawful payments of dividends or unlawful stock repurchases, redemptions or other distributions or (iv) for any transaction from which the director derived an improper personal benefit. The registrant's amended and restated certificate of incorporation provides for such limitation of liability.

        In addition, as permitted by Section 145 of the DGCL, the by-laws of the registrant to be effective upon completion of this offering provide that:

    The registrant shall indemnify its directors and officers for serving the registrant in those capacities or for serving other business enterprises at the registrant's request, to the fullest extent permitted by Delaware law. Delaware law provides that a corporation may indemnify such person if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the registrant and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person's conduct was unlawful.

    The registrant may, in its discretion, indemnify employees and agents in those circumstances where indemnification is permitted by applicable law.

    The registrant is required to advance expenses, as incurred, to its directors and officers in connection with defending a proceeding, except that such director or officer shall undertake to

II-1


      repay such advances if it is ultimately determined that such person is not entitled to indemnification.

    The registrant will not be obligated pursuant to the by-laws to indemnify a person with respect to proceedings initiated by that person, except with respect to proceedings authorized by the registrant's board of directors or brought to enforce a right to indemnification.

    The rights conferred in the by-laws are not exclusive, and the registrant is authorized to enter into indemnification agreements with its directors, officers, employees and agents and to obtain insurance to indemnify such persons.

    The registrant may not retroactively amend the by-law provisions to reduce its indemnification obligations to directors, officers, employees and agents.

        The registrant's policy is to enter into separate indemnification agreements with each of its directors and officers that provide the maximum indemnity allowed to directors and executive officers by Section 145 of the DGCL and certain additional procedural protections. The registrant will also maintain directors and officers insurance to insure such persons against certain liabilities.

        These indemnification provisions and the indemnification agreements entered into between the registrant and its officers and directors may be sufficiently broad to permit indemnification of the registrant's officers and directors for liabilities (including reimbursement of expenses incurred) arising under the Securities Act.

        The underwriting agreement to be filed as Exhibit 1.1 to this registration statement provides for indemnification by the underwriters of the registrant and its officers and directors for certain liabilities arising under the Securities Act and otherwise.

ITEM 15.    RECENT SALES OF UNREGISTERED SECURITIES.

        We sold the following shares of our Series D preferred stock, Series E preferred stock, Series F preferred stock, Series G preferred stock, voting common stock and non-voting common stock to the following entities and individuals on the dates set forth below. The issuances of these securities were deemed to be exempt from registration under the Securities Act of 1933, as amended, in reliance on Section 4(2) of the Securities Act as transactions not involving a public offering. The information set forth below with respect to our voting common stock and non-voting common stock gives effect to (i) the three-for-one forward stock split of our voting common stock and non-voting common stock that was completed in August 2010; (ii) the two-for-one forward stock split of our voting common stock and non-voting common stock that was completed in January 2011; and (iii) the two-for-one forward stock split of our voting common stock and non-voting common stock that was completed in October 2011.

Name of Stockholder
  Series D
Preferred
Stock (1)
  Series E
Preferred
Stock (2)
  Series F
Preferred
Stock (3)
  Voting
Common
Stock (4)
  Non-Voting
Common
Stock (5)
  Series G
Preferred
Stock (6)
  Date of
Purchase
  Total
Purchase
Price
 

Entities affiliated with New Enterprise Associates

    6,560,174                                   1/15/08   $ 4,799,999  

Andrew D. Mason

                            3,600,000           11/1/09   $ 144,000  

Entities affiliated with Accel Growth Fund L.P. 

          2,932,552                             11/17/09   $ 20,000,005  

Entities affiliated with New Enterprise Associates

          1,466,276                             11/17/09   $ 10,000,002  

The Board of Trustees of Leland Stanford Junior University

          7,332                             11/17/09   $ 50,004  

Entities affiliated with Digital Sky Technologies

                3,113,080                       4/16/10   $ 100,000,000  

Entities affiliated with Battery Ventures

                1,089,578                       4/16/10   $ 35,000,000  

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Name of Stockholder
  Series D
Preferred
Stock (1)
  Series E
Preferred
Stock (2)
  Series F
Preferred
Stock (3)
  Voting
Common
Stock (4)
  Non-Voting
Common
Stock (5)
  Series G
Preferred
Stock (6)
  Date of
Purchase
  Total
Purchase
Price
 

Goodrec, Inc. stockholders

                            714,704           5/6/10     (7)  

CityDeal Management UG (haftungsbeschraenkt) & Co. Beteiligungs KG

                      3,960,000                 5/15/10     (8)  

CD-Inv Holding UG (haftungsbeschraenkt) & Co. Beteiligungs KG

                      11,878,812                 5/15/10     (8)  

Entities Affiliated with Oliver and Marc Samwer (9)

                      23,761,188                 5/15/10     (8)  

Goodrec, Inc. stockholders

                            240,000           11/6/10     (10)  

Ludic Labs Inc. stockholders

                            2,460,000           11/30/10     (11)  

CityDeal Management UG (haftungsbeschraenkt) & Co. Beteiligungs KG

                      4,020,000                 12/1/10     (12)  

CD-Inv Holding UG (haftungsbeschraenkt) & Co. Beteiligungs KG

                      12,058,800                 12/1/10     (12)  

Entities Affiliated with Oliver and Marc Samwer (9)

                      27,121,200                 12/1/10     (12)  

Entities affiliated with The Growth Fund of America, Inc. 

                                  5,539,730     12/17/10   $ 175,000,071  

Entities affiliated with Fidelity Investments

                                  3,165,559     12/17/10   $ 100,000,009  

Entities affiliated with Morgan Stanley Investment Management

                                  2,374,170     12/17/10   $ 75,000,030  

Entities affiliated with T. Rowe Price

                                  3,165,559     12/17/10   $ 100,000,009  

Allen & Company, LLC

                                  126,622     1/11/11   $ 3,999,989  

Entities affiliated with DST Global Limited

                                  1,614,436     1/11/11   $ 51,000,033  

Andreessen Horowitz Fund II, L.P. 

                                  1,266,223     1/11/11   $ 39,999,985  

Entities affiliated with Battery Ventures VIII, L.P. 

                                  728,079     1/11/11   $ 23,000,016  

Entities affiliated with Greylock XIII Limited Partnership

                                  2,057,613     1/11/11   $ 64,999,995  

Guy Oseary Family Trust

                                  63,311     1/11/11   $ 1,999,994  

KPCB Holdings, Inc. 

                                  2,057,614     1/11/11   $ 65,000,026  

Entities affiliated with Maverick Fund Private Investments, Ltd. 

                                  1,582,780     1/11/11   $ 50,000,020  

SLP Green Holdings, L.L.C. 

                                  1,582,779     1/11/11   $ 49,999,989  

Entities affiliated with TCV Member Fund, L.P. 

                                  4,748,339     1/11/11   $ 150,000,029  

Entities affiliated with Howard Schultz

                            1,899,336           2/10/11   $ 15,000,006  

Matt McCutchen

                            29,040           2/10/11   $ 229,343  

Placido Arango

                            126,622           2/10/11   $ 999,997  

Theodore J. Leonsis

                            126,662           2/10/11   $ 1,000,313  

Pelago Stockholders

                            380,300           4/18/11     (14)  

Zappedy stockholders

                            426,184           7/15/11     (13)  

Entities Affiliated with Oliver and Marc Samwer (15)

                                  2,908,856     7/29/11     (16)
 

(1)
Each share of Series D preferred stock was converted into 12 shares of Class A common stock on October 31, 2011.

(2)
Each share of Series E preferred stock was converted into 12 shares of Class A common stock on October 31, 2011.

(3)
Each share of Series F preferred stock was converted into 12 shares of Class A common stock on October 31, 2011.

(4)
Each share of voting common stock was converted into one share of Class A common stock on October 31, 2011.

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(5)
Each share of non-voting common stock was converted into one share of Class A common stock on October 31, 2011.

(6)
Each share of Series G preferred stock was converted into four shares of Class A common stock on October 31, 2011.

(7)
These shares were issued as partial consideration in connection with the merger of Goodrec, Inc. d/b/a Mobly with and into Groupon Mobly, Inc.

(8)
These shares were issued as consideration in connection with acquisition the of CityDeal Europe GmbH by Groupon Germany GbR.

(9)
Shares issued to CD-Rocket Holdings UG (haftungsbeschraenkt) & Co. Beteiligungs KG is owned by Rocket Internet GmbH, 83.34% of which is owned by European Founders Fund GmbH. European Founders Fund is owned by Oliver Samwer (33.33%), Marc Samwer (33.33%) and Alexander Samwer (33.33%).

(10)
These shares were issued as contingent consideration in connection with the merger of Goodrec, Inc. d/b/a Mobly with and into Groupon Mobly, Inc.

(11)
These shares were issued as partial consideration in connection with the merger of Ludic Labs, Inc. with and into Groupon Ludic, Inc.

(12)
These shares were issued as contingent consideration in connection with the acquisition of CityDeal Europe GmbH by Groupon Germany GbR.

(13)
These shares were issued as consideration in connection with the acquisition of Zappedy, Inc. by Groupon.

(14)
These shares were issued as partial consideration in connection with the acquisition of Pelago, Inc.

(15)
Shares issued to Rocket Asia GmbH & Co. KG is owned by Rocket Internet GmbH, 83.34% of which is owned by European Founders Fund GmbH. European Founders Fund is owned by Oliver Samwer (33.33%), Marc Samwer (33.33%) and Alexander Samwer (33.33%).

(16)
These shares were issued as consideration in connection with an increase in Groupon's interest in E-Commerce King Limited.

        Since January 1, 2008, we have granted options to 664 of our employees or consultants to purchase an aggregate of 37,710,400 shares of our common stock, of which 11,084,412 have been exercised, 8,218,478 have expired and 18,407,510 remain either unvested or unexercised. The weighted average exercise price for the unvested and/or unexercised options is $1.11 per share. In addition, since January 1, 2008, we have granted 20,106,714 restricted stock units to 346 of our employees or consultants, 10,575,100 of which remain unvested. Each of the option and restricted stock unit grants were awarded under either the Company's 2011 Incentive Plan, 2010 Stock Plan or 2008 Stock Option Plan and, subject to the terms of those plans, vest and allow for exercise, as applicable, in accordance with the terms of each individual grant.

        Other than the transactions listed immediately above, we have not issued and sold any unregistered securities in the three years preceding the filing of this registration statement.

ITEM 16.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

    (a)
    Exhibits. The following exhibits are included herein or incorporated herein by reference:

Exhibit
Number
  Description
  1.1   Form of Underwriting Agreement.

 

3.1

+

Fifth Amended and Restated Certificate of Incorporation.

 

3.2

+

Sixth Amended and Restated Certificate of Incorporation.

 

3.3

+

By-Laws.

 

3.4

+

Amended and Restated By-Laws.

 

4.1

+

Specimen Class A common stock certificate of the Registrant.

 

4.2

+

Third Amended and Restated Investors Rights Agreement, dated as of December 10, 2010, between Groupon, Inc. and certain investors named therein.

II-4


Exhibit
Number
  Description
  5.1 + Opinion of Winston & Strawn LLP.

 

10.1

+

2008 Stock Option Plan.**

 

10.2

+

Form of Notice of Grant of Stock Option under 2008 Stock Option Plan.**

 

10.3

+

2010 Stock Plan.**

 

10.4

+

Form of Notice of Grant of Stock Option under 2010 Stock Plan.**

 

10.5

+

Form of Notice of Restricted Stock Unit Award under 2010 Stock Plan.**

 

10.6

+

Employment Agreement, dated as of November 1, 2009, by and between Groupon, Inc. and Andrew D. Mason.**

 

10.7

+

Amendment to Employment Agreement, dated as of December 15, 2010, by and between Groupon, Inc. and Andrew D. Mason.**

 

10.8

+

Amended and Restated Employment Agreement, dated as of April 29, 2011, by and between Groupon, Inc. and Jason Child.**

 

10.9

+

Employment Agreement, dated as of March 15, 2010, by and between Groupon, Inc. and Robert S. Solomon.**

 

10.10

+

Amendment to Employment Agreement, dated as of December 15, 2010, by and between Groupon, Inc. and Robert S. Solomon.**

 

10.11

+

Employment Agreement, dated as of November 30, 2010, by and between Groupon, Inc., Groupon Ludic, Inc. and Brian Totty.**

 

10.12

+

Consulting Contract, dated May 12, 2010, between CityDeal Europe GmbH and Oliver Samwer, as amended.**

 

10.13

+

Share Exchange and Transfer Agreement, dated as of May 15, 2010, by and among CD-Inv Holding UG, CD-Rocket Holding UG, CityDeal Management UG, CityDeal Europe GmbH, Groupon German GbR and Groupon,  Inc.

 

10.14

+

Earn-out Agreement, dated as of May 15, 2010, by and among CD-Inv Holding UG, CD-Rocket Holding UG, CityDeal Management UG, CityDeal Europe GmbH, Groupon German GbR and Groupon, Inc.

 

10.15

+

First Amendment to Earn-Out Agreement, dated as of September 14, 2010, by and among CD-Inv Holding UG, CD-Rocket Holding UG, CityDeal Management UG, CityDeal Europe GmbH, Groupon German GbR and Groupon,  Inc.

 

10.16

+

Second Amendment to Earn-Out Agreement, dated as of November 30, 2010, by and among CD-Inv Holding UG, CD-Rocket Holding UG, CityDeal Management UG, CityDeal Europe GmbH, Groupon German GbR and Groupon,  Inc.

 

10.17

+

Agreement of Lease, dated as of October 14, 2010, by and between 600 West Chicago Associates LLC and Groupon, Inc.

 

10.18

+

Sublease, dated as of June 2010, by and between Lightbank LLC and Groupon, Inc.

 

10.19

+

Office Sublease Agreement, dated as of June 23, 2009, by and between InnerWorkings, Inc. and The Point.

 

10.20

+

Agreement of Lease, dated as of December 7, 2010, by and between 600 West Chicago Associates LLC and Groupon, Inc.

II-5


Exhibit
Number
  Description
  10.21 + Agreement and Plan of Merger, dated as of May 6, 2010, by and among Groupon, Inc., Groupon Mobly, Inc., Goodrec, Inc. and the Stockholders' Representative named therein.

 

10.22

+

Agreement and Plan of Merger, dated as of November 30, 2010, by and among Groupon, Inc., Groupon Ludic, Inc., Ludic Labs, Inc. and the Stockholders' Representative named therein.

 

10.23

+

Separation Agreement and General Release, dated as of April 6, 2011, by and between Groupon, Inc. and Ken Pelletier.**

 

10.24

+

Transition Services and Separation Agreement and Mutual General Release, dated as of April 5, 2011, by and between Groupon, Inc. and Robert S. Solomon.**

 

10.25

+

Employment Agreement, dated as of April 15, 2011, by and between Groupon, Inc. and Mary Margaret H. Georgiadis.**

 

10.26

+

Letter Agreement, dated as of August 11, 2010, by and between Qpod.inc, IVP Fund A, L.P., IVP Fund B, L.P. and Groupon B.V. and Groupon, Inc.

 

10.27

+

Form of Indemnification Agreement**

 

10.28

+

2011 Incentive Plan**

 

10.29

+

Amendment to Transition Services and Separation Agreement and Mutual General Release, dated as of July 25, 2011, by and between Groupon, Inc. and Robert S. Solomon.**

 

10.30

+

Consulting Contract, dated May 12, 2010, between CityDeal Europe GmbH and Marc Samwer, as amended.**

 

10.31

+

Confidential Separation Agreement and General Mutual Release, dated as of October 17, 2011, by and between Mary Margaret H. "Margo" Georgiadis and Groupon, Inc.**

 

10.32

+

Amendment No. 1 to Agreement and Plan of Merger, dated as of September 22, 2011, by and between Groupon, Inc. and Mihir Shah, as the stockholders' representative on behalf of the stockholders named therein.

 

21.1

+

Subsidiaries of Groupon, Inc.

 

23.1

+

Consent of Ernst & Young LLP for Groupon, Inc.

 

23.2

+

Consent of Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft.

 

23.3

+

Consent of Ernst & Young ShinNihon LLC.

 

23.4

+

Consent of Ernst & Young LLP for Ludic Labs, Inc. and Goodrec, Inc.

 

23.5

+

Consent of Winston & Strawn LLP (included in Exhibit 5.1).

 

24.1

+

Power of Attorney.

**
Management contract or compensatory plan or arrangement.

+
Previously filed.

II-6


    (b)
    Financial Statement Schedules.


Report of Independent Registered Public Accounting Firm

        The Board of Directors and Stockholders of Groupon, Inc.

        We have audited the consolidated financial statements of Groupon, Inc. as of December 31, 2009 and 2010, and for each of the three years in the period ended December 31, 2010, and have issued our report thereon dated June 2, 2011 (included elsewhere in this Registration Statement). Our audits also included the financial statement schedule listed in Item 16(b) of Form S-1 of this Registration Statement. This schedule is the responsibility of the Company's management. Our responsibility is to express an opinion based on our audits.

        In our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

/s/ Ernst & Young LLP
Chicago, Illinois
June 2, 2011


Schedule II—Valuation and Qualifying Accounts

 
  Balance at
Beginning of
Year
  Charged to
Expense
  Acquisitions
and Other
  Balance at End
of Year
 
 
  (in thousands)
 

TAX VALUATION ALLOWANCE:

                         
 

Year ended December 31, 2008

  $   $ 644   $ 252   $ 896  
 

Year ended December 31, 2009

    896     682         1,528  
 

Year ended December 31, 2010

    1,528     50,474     3,954     55,956  

        All other schedules have been omitted because they are either inapplicable or the required information has been given in the consolidated financial statements or the notes thereto.

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ITEM 17.    UNDERTAKINGS.

        The undersigned registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

        Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

        The undersigned registrant hereby undertakes that:

        (1)   For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

        (2)   For the purpose of determining any liability under the Securities Act of 1933, each post effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-8



SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Chicago, Illinois, on the 2nd day of November, 2011.

    GROUPON, INC.

 

 

By:

 

/s/ ANDREW D. MASON

        Name:   Andrew D. Mason
        Title:   Chief Executive Officer

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature
 
Title
 
Date

 

 

 

 

 
/s/ ANDREW D. MASON

Andrew D. Mason
  President, Chief Executive Officer and Director (Principal Executive Officer)   November 2, 2011

*

Jason E. Child

 

Chief Financial Officer (Principal Financial Officer)

 

November 2, 2011

*

Joseph M. Del Preto

 

Chief Accounting Officer (Principal Accounting Officer)

 

November 2, 2011

*

Peter J. Barris

 

Director

 

November 2, 2011

*

Kevin J. Efrusy

 

Director

 

November 2, 2011

*

Mellody Hobson

 

Director

 

November 2, 2011

*

Bradley A. Keywell

 

Director

 

November 2, 2011

II-9


Signature
 
Title
 
Date

 

 

 

 

 
*

Eric P. Lefkofsky
  Director   November 2, 2011

*

Theodore J. Leonsis

 

Director

 

November 2, 2011

*

Howard Schultz

 

Director

 

November 2, 2011

 

*By:   /s/ ANDREW D. MASON

Andrew D. Mason, as attorney-in-fact
       

II-10



EXHIBIT INDEX

 
  Exhibit
Number
  Description
      1.1   Form of Underwriting Agreement.

 

 

 

3.1

+

Fifth Amended and Restated Certificate of Incorporation.

 

 

 

3.2

+

Sixth Amended and Restated Certificate of Incorporation.

 

 

 

3.3

+

By-Laws, as currently in effect.

 

 

 

3.4

+

Amended and Restated By-Laws.

 

 

 

4.1

+

Specimen Class A common stock certificate of the Registrant.

 

 

 

4.2

+

Third Amended and Restated Investors Rights Agreement, dated as of December 10, 2010, between Groupon, Inc. and certain investors named therein.

 

 

 

5.1

+

Opinion of Winston & Strawn LLP.

 

 

 

10.1

+

2008 Stock Option Plan.**

 

 

 

10.2

+

Form of Notice of Grant of Stock Option under 2008 Stock Option Plan.**

 

 

 

10.3

+

2010 Stock Plan.**

 

 

 

10.4

+

Form of Notice of Grant of Stock Option under 2010 Stock Plan.**

 

 

 

10.5

+

Form of Notice of Restricted Stock Unit Award under 2010 Stock Plan.**

 

 

 

10.6

+

Employment Agreement, dated as of November 1, 2009, by and between Groupon, Inc. and Andrew D. Mason.**

 

 

 

10.7

+

Amendment to Employment Agreement, dated as of December 15, 2010, by and between Groupon, Inc. and Andrew D. Mason.**

 

 

 

10.8

+

Amended and Restated Employment Agreement, dated as of April 29, 2011, by and between Groupon, Inc. and Jason Child.**

 

 

 

10.9

+

Employment Agreement, dated as of March 15, 2010, by and between Groupon, Inc. and Robert S. Solomon.**

 

 

 

10.10

+

Amendment to Employment Agreement, dated as of December 15, 2010, by and between Groupon, Inc. and Robert S. Solomon.**

 

 

 

10.11

+

Employment Agreement, dated as of November 30, 2010, by and between Groupon, Inc., Groupon Ludic, Inc. and Brian Totty.**

 

 

 

10.12

+

Consulting Contract, dated May 12, 2010, between CityDeal Europe GmbH and Oliver Samwer, as amended.**

 

 

 

10.13

+

Share Exchange and Transfer Agreement, dated as of May 15, 2010, by and among CD-Inv Holding UG, CD-Rocket Holding UG, CityDeal Management UG, CityDeal Europe GmbH, Groupon Germany GbR and Groupon,  Inc.

 

 

 

10.14

+

Earn-out Agreement, dated as of May 15, 2010, by and among CD-Inv Holding UG, CD-Rocket Holding UG, CityDeal Management UG, CityDeal Europe GmbH, Groupon Germany GbR and Groupon, Inc.

II-11


 
  Exhibit
Number
  Description
      10.15 + First Amendment to Earn-Out Agreement, dated as of September 14, 2010, by and among CD-Inv Holding UG, CD-Rocket Holding UG, CityDeal Management UG, CityDeal Europe GmbH, Groupon Germany GbR and Groupon,  Inc.

 

 

 

10.16

+

Second Amendment to Earn-Out Agreement, dated as of November 30, 2010, by and among CD-Inv Holding UG, CD-Rocket Holding UG, CityDeal Management UG, CityDeal Europe GmbH, Groupon Germany GbR and Groupon, Inc.

 

 

 

10.17

+

Agreement of Lease, dated as of October 14, 2010, by and between 600 West Chicago Associates LLC and Groupon, Inc.

 

 

 

10.18

+

Sublease, dated as of June 2010, by and between Lightbank LLC and Groupon, Inc.

 

 

 

10.19

+

Office Sublease Agreement, dated as of June 23, 2009, by and between InnerWorkings, Inc. and The Point.

 

 

 

10.20

+

Agreement of Lease, dated as of December 7, 2010, by and between 600 West Chicago Associates LLC and Groupon, Inc.

 

 

 

10.21

+

Agreement and Plan of Merger, dated as of May 6, 2010, by and among Groupon, Inc., Groupon Mobly, Inc., Goodrec, Inc. and the Stockholders' Representative named therein.

 

 

 

10.22

+

Agreement and Plan of Merger, dated as of November 30, 2010, by and among Groupon, Inc., Groupon Ludic, Inc., Ludic Labs, Inc. and the Stockholders' Representative named therein.

 

 

 

10.23

+

Separation Agreement and General Release, dated as of April 6, 2011, by and between Groupon, Inc. and Ken Pelletier.**

 

 

 

10.24

+

Transition Services and Separation Agreement and Mutual General Release, dated as of April 5, 2011, by and between Groupon, Inc. and Robert S. Solomon.**

 

 

 

10.25

+

Employment Agreement, dated as of April 15, 2011, by and between Groupon, Inc. and Mary Margaret H. Georgiadis.**

 

 

 

10.26

+

Letter Agreement, dated as of August 11, 2010, by and between Qpod.inc, IVP Fund A, L.P., IVP Fund B, L.P. and Groupon B.V. and Groupon, Inc.

 

 

 

10.27

+

Form of Indemnification Agreement.**

 

 

 

10.28

+

2011 Incentive Plan.**

 

 

 

10.29

+

Amendment to Transition Services Agreement and Mutual General Release, dated as of July 25, 2011, by and between Groupon, Inc. and Robert S. Solomon.**

 

 

 

10.30

+

Consulting Contract, dated May 12, 2010, between CityDeal Europe GmbH and Marc Samwer, as amended.**

 

 

 

10.31

+

Confidential Separation Agreement and General Mutual Release, dated as of October 17, 2011, by and between Mary Margaret H. "Margo" Georgiadis and Groupon, Inc.**

 

 

 

10.32

+

Amendment No. 1 to Agreement and Plan of Merger, dated as of September 22, 2011, by and between Groupon, Inc. and Mihir Shah, as the stockholders' representative on behalf of the stockholders named therein.

 

 

 

21.1

+

Subsidiaries of Groupon, Inc.

 

 

 

23.1

+

Consent of Ernst & Young LLP for Groupon, Inc.

 

 

 

23.2

+

Consent of Ernst & Young GmbH Wirtschaftsprüfungsgesellscaft.

 

 

 

23.3

+

Consent of Ernst & Young ShinNihon LLC.

 

 

 

23.4

+

Consent of Ernst & Young LLP for Ludic Labs, Inc. and Goodrec, Inc.

 

 

 

23.5

+

Consent of Winston & Strawn LLP (included in Exhibit 5.1).

 

 

 

24.1 +

 

Power of Attorney.

**
Management contract or compensatory plan or arrangement.

+
Previously Filed.

II-12




QuickLinks

EXPLANATORY NOTE
PART II INFORMATION NOT REQUIRED IN PROSPECTUS
Report of Independent Registered Public Accounting Firm
Schedule II—Valuation and Qualifying Accounts
SIGNATURES
EXHIBIT INDEX

Exhibit 1.1

 

[ · ] Shares

 

 

GROUPON, INC.

 

 

CLASS A COMMON STOCK, PAR VALUE $0.0001 PER SHARE

 

 

UNDERWRITING AGREEMENT

 

 

[ · ], 2011

 



 

[ · ], 2011

 

Morgan Stanley & Co. LLC

Goldman, Sachs & Co.

Credit Suisse Securities (USA) LLC

Acting severally on behalf of themselves and

the several Underwriters named in Schedule I

hereto

 

Morgan Stanley & Co. LLC

1585 Broadway

New York, New York  10036

 

Goldman, Sachs & Co.

200 West Street

New York, New York  10282

 

Credit Suisse Securities (USA) LLC

Eleven Madison Avenue,

New York, N.Y. 10010

 

Ladies and Gentlemen:

 

Groupon, Inc., a Delaware corporation (the “ Company ”), proposes to issue and sell to the several Underwriters named in Schedule I hereto (the “ Underwriters ”) an aggregate of [ · ] shares of the Class A common stock, par value $0.0001 per share, of the Company (the “ Firm Shares ”).

 

The Company also proposes to issue and sell to the several Underwriters not more than an additional [ · ] shares of the Class A common stock, par value $0.0001 per share, of the Company (the “ Additional Shares ”), if and to the extent that you, as managers of the offering, shall have determined to exercise, on behalf of the Underwriters, the right to purchase such shares of Class A common stock granted to the Underwriters in Section 2 hereof.  The Firm Shares and the Additional Shares are hereinafter collectively referred to as the “ Shares .” The shares of Class A common stock, par value $0.0001 per share, of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the “ Class A Common Stock .”

 

The Company has filed with the Securities and Exchange Commission (the “ Commission ”) a registration statement on Form S-1 (File No. 333-174661), including a prospectus, relating to the Shares.  The registration statement as amended at the time it becomes effective, including the information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as amended (the

 



 

Securities Act ”), is hereinafter referred to as the “ Registration Statement ”; the prospectus in the form first used to confirm sales of Shares (or in the form first made available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the “ Prospectus .”  If the Company has filed an abbreviated registration statement to register additional shares of Class A Common Stock pursuant to Rule 462(b) under the Securities Act (the “ Rule 462 Registration Statement ”), then any reference herein to the term “ Registration Statement ” shall be deemed to include such Rule 462 Registration Statement.

 

For purposes of this Agreement, “ free writing prospectus ” has the meaning set forth in Rule 405 under the Securities Act, “ Time of Sale Prospectus ” means the preliminary prospectus contained in the Registration Statement at the time of its effectiveness together with the free writing prospectuses, if any, each identified in Schedule II hereto, and “ broadly available road show ” means a “bona fide electronic road show” as defined in Rule 433(h)(5) under the Securities Act that has been made available without restriction to any person.  As used herein, the terms “Registration Statement,” “preliminary prospectus,” “Time of Sale Prospectus” and “Prospectus” shall include the documents, if any, incorporated by reference therein.

 

1.                          Representations and Warranties of the Company .  The Company represents and warrants to and agrees with each of the Underwriters that:

 

(a)                     The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose are pending before or, to the Company’s knowledge, threatened by the Commission.

 

(b)                    (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, will not, as of the date of such amendment or supplement, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement and the Prospectus comply and, as amended or supplemented, if applicable, will comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date (as defined in Section 4), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they

 

2



 

were made, not misleading, (iv) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (v) as of its date and the Closing Date, the Prospectus does not contain and, as amended or supplemented, if applicable, will not contain, any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale Prospectus or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein.

 

(c)                     The Company is not an “ineligible issuer” in connection with the offering pursuant to Rules 164, 405 and 433 under the Securities Act.  Any free writing prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder.  Each free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies or will comply in all material respects with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder.  Except for the free writing prospectuses, if any, identified in Schedule II hereto, and electronic road shows, if any, each furnished to you before first use, the Company has not prepared, used or referred to, and will not, without your prior consent, prepare, use or refer to, any free writing prospectus.

 

(d)               The Company has been duly incorporated, is validly existing as a corporation in good standing under the laws of the State of Delaware, has the corporate power and authority to own or lease its property and to conduct its business as described in the Time of Sale Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(e)                Each subsidiary of the Company has been duly incorporated (or formed) (or if in a foreign jurisdiction, enjoys the equivalent status under the laws of the jurisdiction of organization outside of the United States), is validly existing as a corporation (or other entity) in good standing (or of the most directly

 

3



 

comparable status under foreign law applicable to it) under the laws of the jurisdiction of its incorporation (or formation) (to the extent such concepts are applicable under such laws), has the corporate (or other) power and authority to own or lease its property and to conduct its business to the extent described in the Time of Sale Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification (to the extent such concepts are applicable under such laws), except to the extent that the failure to be so qualified or be in good standing would not have a material adverse effect on the Company and its subsidiaries, taken as a whole; all of the issued equity interests of each significant subsidiary (as such term is defined in Rule 1-02 of Regulation S-X) of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims, except to the extent that such liens, encumbrances, equities or claims would not have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(f)                  This Agreement has been duly authorized, executed and delivered by the Company.

 

(g)               The authorized capital stock of the Company conforms as to legal matters to the description thereof contained in each of the Time of Sale Prospectus and the Prospectus.

 

(h)               The Company has the authorized capitalization as set forth in the Time of Sale Prospectus; all of the shares of Class A Common Stock outstanding prior to the issuance of the Shares to be sold by the Company have been duly authorized by the Company and are validly issued, fully paid and non-assessable.

 

(i)                   The Shares to be sold by the Company have been duly authorized by the Company and, when issued, delivered and paid for in accordance with the terms of this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of such Shares will not be subject to any preemptive or similar rights.

 

(j)                   Neither the Company nor any of its subsidiaries has taken, directly or indirectly, any action that is designed to or that would reasonably be expected to cause or result in stabilization or manipulation of the price of the Shares.

 

(k)                Neither the Company nor any of its “significant subsidiaries” (as such term is defined in Rule 1-02 of Regulation S-X) is in (i) violation of its certificate of incorporation or bylaws (or equivalent organizational documents), (ii) default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any

 

4



 

term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company is a party or by which the Company or any of its significant subsidiaries is bound or to which any of the property or assets of the Company or any of its significant subsidiaries is subject, or (iii) to the knowledge of the Company, violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the cases of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(l)                   The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement will not contravene (i) any provision of applicable law, (ii) the certificate of incorporation or by-laws of the Company, (iii) any agreement or other instrument binding upon the Company or any of its subsidiaries that is material to the Company and its subsidiaries, taken as a whole, or (iv) any judgment, order or decree of any governmental body, agency or court having jurisdiction over the Company or any of its subsidiaries, except in the case of clauses (i), (iii) and (iv) above, where such contravention would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole, or a material adverse effect on the ability of the Company to perform its obligations under this Agreement.  No consent, approval, authorization or order of, or qualification with, any governmental body or agency is required for the performance by the Company of its obligations under this Agreement, except (i) such as may have previously been obtained, (ii) such as may be required by the securities or Blue Sky laws of the various states or other foreign jurisdictions in connection with the offer and sale of the Shares, and (iii) for any such consents, approvals, authorizations, orders or qualifications, the absence of which would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole, or a material adverse effect on the ability of the Company to perform its obligations under this Agreement or to consummate the transactions contemplated by the Time of Sale Prospectus.

 

(m)             There has not occurred any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus.

 

(n)               There are no legal or governmental proceedings pending or, to the Company’s knowledge, threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of

 

5



 

its subsidiaries is subject (i) other than proceedings accurately described in all material respects in the Time of Sale Prospectus and proceedings that would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, or a material adverse effect on the power or ability of the Company to perform its obligations under this Agreement or to consummate the transactions contemplated by the Time of Sale Prospectus or (ii) that are required to be described in the Registration Statement or the Prospectus and are not so described in all material respects; and there are no statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not described, in all material respects, or filed as required.

 

(o)               Each preliminary prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act, complied when so filed in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder.

 

(p)               The Company is not, and after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Prospectus will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.

 

(q)               The Company and its subsidiaries, taken as a whole, (i) are in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (“ Environmental Laws ”), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(r)                  There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) which would, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

6



 

(s)                Except as described in the Time of Sale Prospectus, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement.

 

(t)                  Neither the Company nor any of its subsidiaries or controlled affiliates, nor any director or officer, nor, to the Company’s knowledge, any employee, agent or representative of the Company or any of its subsidiaries or controlled affiliates acting on behalf of the Company or any of its subsidiaries or controlled affiliates, has taken any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment or giving of money, property, gifts or anything else of value, directly or indirectly, to any “government official” (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) to  improperly influence official action or secure an improper advantage for the Company or any of its subsidiaries or controlled affiliates; and the Company and its subsidiaries and controlled affiliates have conducted their businesses in material compliance with the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the “ FCPA ”) and any other applicable anti-corruption laws and have instituted and maintained policies and procedures designed to promote and achieve compliance with the FCPA and any other applicable anti-corruption laws.

 

(u)               The operations of the Company and its subsidiaries are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company and its subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “ Anti-Money Laundering Laws ”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

 

7



 

(v)               (i)  Neither the Company nor any of its subsidiaries (collectively, the “ Entity ”), nor any director or officer of the Company, nor, to the Company’s knowledge, any employee, agent, controlled affiliate, joint venture partner or representative of the Entity, is an individual or entity (“ Person ”) that is, or is owned or controlled by a Person that is:

 

(A)  the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control (“ OFAC ”), the United Nations Security Council (“ UNSC ”), the European Union (“ EU ”), Her Majesty’s Treasury (“ HMT ”), or other relevant sanctions authority (collectively, “ Sanctions ”), nor

 

(B)  located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Burma/Myanmar, Cuba, Iran, Libya, North Korea, Sudan and Syria).

 

(ii)  The Entity will not, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person:

 

(A)  to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or

 

(B)  in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).

 

(iii)  For the past five years, the Entity has not knowingly engaged in, and is not now knowingly engaged in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.

 

(w)             Subsequent to the respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) the Company and its subsidiaries, taken as a whole, have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction not in the ordinary course of business; (ii) the Company has not purchased any of its outstanding capital stock, nor declared, paid or otherwise made any dividend or distribution of any kind on its capital stock other than ordinary and customary dividends; and (iii) there has not been any material

 

8



 

change in the capital stock, short-term debt or long-term debt of the Company and its subsidiaries, taken as a whole, except in each case as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, respectively.

 

(x)                 The Company and its subsidiaries do not own any real property.  The Company and its subsidiaries, taken as a whole, have good and marketable title to all personal property owned by them that is material to the business of the Company and its subsidiaries, taken as a whole, in each case free and clear of all liens, encumbrances and defects except such as are described in the Time of Sale Prospectus or such as do not materially detract from the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries, taken as a whole; and any real property and buildings held under lease by the Company and its subsidiaries, taken as a whole, are held by them under valid, subsisting and, to the Company’s knowledge, enforceable leases with such exceptions as are not material and do not materially interfere with the use made and proposed to be made of such property and buildings by the Company and its subsidiaries, taken as a whole, in each case except as described in the Time of Sale Prospectus.

 

(y)               The Company and its subsidiaries, taken as a whole, own or possess, have the right to use, or can acquire on commercially reasonable terms, ownership of or rights to use all: material patents, patent rights, and inventions; works of authorship (including software) and copyrights; know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), and trademarks, service marks and trade names and trade dress (whether or not registered) currently employed by them in connection with the business now operated by them, except where the failure to own, possess or acquire any of the foregoing would not result in a material adverse effect on the Company and its subsidiaries, taken as a whole, and except as described in the Prospectus (collectively, “ Intellectual Property ”); and neither the Company nor any of its subsidiaries has received any notice of infringement of or conflict with asserted rights of others with respect to any of the foregoing that, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(z)                 The Company and each of its subsidiaries have complied and are presently in compliance in all material respects with its privacy policies and all laws and regulations applicable to it regarding the collection, use, transfer, import, export, storage, protection, disposal and disclosure by the Company and its subsidiaries of personally identifiable information or other information relating to persons protected by law.

 

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(aa)                        No labor dispute with the employees of the Company or any of its subsidiaries that is material to the business of the Company and its subsidiaries, taken as a whole, exists, except as described in the Time of Sale Prospectus, or, to the knowledge of the Company, is imminent.

 

(bb)                      The Company and its subsidiaries, taken as a whole, are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as the Company believes are prudent and customary in the businesses in which they are engaged; and the Company and its subsidiaries, taken as a whole, have no reason to believe that they will not be able to renew their existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, except as described in the Time of Sale Prospectus.

 

(cc)                        The Company and its subsidiaries, taken as a whole, possess all certificates, authorizations and permits issued by the appropriate federal, state or foreign governmental or regulatory authorities necessary to conduct its business, except for such certificates, authorizations and permits, the failure of which to obtain, would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, and neither the Company nor any of its subsidiaries has received any written notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a material adverse effect on the Company and its subsidiaries, taken as a whole, except as described in the Time of Sale Prospectus.

 

(dd)                      The Company and its subsidiaries, taken as a whole, maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with U.S. generally accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the amounts reflected on the Company’s balance sheet for assets are compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  Except as described in the Time of Sale Prospectus, since the end of the Company’s most recent audited fiscal year, (i) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) has occurred and (ii) no change in the Company’s internal control over financial reporting has occurred that has

 

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materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

(ee)                        Except as described in the Time of Sale Prospectus, the Company has not sold, issued or distributed any shares of Class A Common Stock during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other than shares issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation plans or pursuant to outstanding options, rights or warrants.

 

(ff)                            Nothing has come to the attention of the Company that has caused the Company to believe that the statistical and market-related data included in the Registration Statement, the Time of Sale Prospectus and the Prospectus is not based on or derived from sources that the Company reasonably believes to be reliable and accurate in all material respects.

 

(gg)                      The Company and each of its subsidiaries have filed all federal, state, local and foreign tax returns required to be filed through the date of this Agreement or have requested extensions thereof (except where the failure to file would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole) and have paid all taxes required to be paid thereon (except for cases in which the failure to pay would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, or, except as currently being contested in good faith and for which reserves required by U.S. generally accepted accounting principles have been created in the financial statements of the Company), and no tax deficiency has been determined adversely to the Company or any of its subsidiaries which remains unpaid and has had (nor does the Company nor any of its subsidiaries have any notice or knowledge of any tax deficiency which remains unpaid and would reasonably be expected to be determined adversely to the Company or any of its subsidiaries) and which would have a material adverse effect on the Company and its subsidiaries taken as a whole .

 

(hh)                      The operations of the Company and its subsidiaries, taken as a whole, are and have been conducted at all times in material compliance with all provisions of the Credit Card Accountability Responsibility and Disclosure Act of 2009 and the rules and regulations thereunder (collectively, the “ Credit Card Laws ”), except as described in the Time of Sale Prospectus and the Prospectus, or except as determined otherwise in the litigations described in the Time of Sale Prospectus and the Prospectus that allege that the Company has violated the Credit Card Laws.  No action, suit or proceeding by or before any court or governmental agency, authority or body

 

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or any arbitrator involving the Company or any of its subsidiaries with respect to the Credit Card Laws is pending or, to the knowledge of the Company, threatened, except as described in the Time of Sale Prospectus and the Prospectus.

 

2.                          Agreements to Sell and Purchase . The Company hereby agrees to sell to the several Underwriters, and each Underwriter, upon the basis of the representations and warranties herein contained, but subject to the conditions hereinafter stated, agrees, severally and not jointly, to purchase from the Company at $[ · ] a share (the “ Purchase Price ”) the number of Firm Shares (subject to such adjustments to eliminate fractional shares as you may determine) that bears the same proportion to the number of Firm Shares to be sold by the Company as the number of Firm Shares set forth in Schedule I hereto opposite the name of such Underwriter bears to the total number of Firm Shares.

 

On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to sell to the Underwriters the Additional Shares, and the Underwriters shall have the right to purchase, severally and not jointly, up to [ · ] Additional Shares at the Purchase Price ; provided, however, that the amount paid by the Underwriters for any Additional Shares shall be reduced by an amount per share equal to any dividends declared by the Company and payable on the Firm Shares but not payable on such Additional Shares .  You may exercise this right on behalf of the Underwriters in whole or from time to time in part by giving written notice of each election to exercise the option not later than 30 days after the date of this Agreement.  Any exercise notice shall specify the number of Additional Shares to be purchased by the Underwriters and the date on which such shares are to be purchased.  Each purchase date must be at least one business day after the written notice is given and may not be earlier than the closing date for the Firm Shares nor later than ten business days after the date of such notice.  Additional Shares may be purchased as provided in Section 5 hereof solely for the purpose of covering sales of shares in excess of the number of Firm Shares.  On each day, if any, that Additional Shares are to be purchased (an “ Option Closing Date ”), each Underwriter agrees, severally and not jointly, to purchase the number of Additional Shares (subject to such adjustments to eliminate fractional shares as you may determine) that bears the same proportion to the total number of Additional Shares to be purchased on such Option Closing Date as the number of Firm Shares set forth in Schedule I hereto opposite the name of such Underwriter bears to the total number of Firm Shares.

 

The Company hereby agrees that, without the prior written consent of Morgan Stanley on behalf of the Underwriters, it will not, during the period commencing on the date hereof and ending on the date that is (i) 180 days after

 

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the date of the Prospectus, or (ii) such earlier date or dates as agreed between the Company and Morgan Stanley (such period, the “ Restricted Period ”) (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of any class or series of the Company’s common stock (the “ Common Stock ”) or any other securities convertible into or exercisable or exchangeable for Common Stock, (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise, or (3) file any registration statement with the Commission relating to the offering of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock.

 

The restrictions contained in the preceding paragraph shall not apply to  (a) sales of Common Stock hereunder, (b) the issuance by the Company of shares of Common Stock upon the exercise of an option or the conversion or vesting of a security outstanding on the date hereof, provided that such option or security is identified in the Time of Sale Prospectus, (c) the issuance by the Company of options or other stock-based compensation pursuant to equity compensation plans in existence on the date hereof and, in each case, described in the Time of Sale Prospectus; provided that any recipients thereof enter into lock-up agreements with the Underwriters in the form of Exhibit A hereto with respect to the remaining 180-day restricted period or any extension thereof or, in the case of the issuance of options, such options do not become exercisable during the 180-day restricted period or any extension thereof, (d) the establishment of a trading plan pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), for the transfer of shares of Common Stock, provided that such plan does not provide for the transfer of Common Stock during the 180-day restricted period and no public announcement or filing under the Exchange Act regarding the establishment of such plan shall be required of or voluntarily made by or on behalf of the Company, (e) the issuance of shares of Common Stock as consideration for bona fide acquisitions, provided that in the case of this clause (e), the number of shares issued or issuable shall not, in the aggregate, exceed 2% of the total number of shares of Common Stock outstanding immediately following the sale of the Shares hereunder (determined on a fully-diluted basis and as adjusted for stock splits, stock dividends and other similar events after the date hereof) and each recipient shall sign and deliver a lock-up agreement in the form attached hereto as Exhibit A with respect to the remaining 180-day restricted period or any extension thereof, or (f) the filing of one or more registration statements with the Commission on Form S-8 with respect to shares of Common Stock issued or issuable under any equity compensation plan in effect on the date

 

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hereof.  Notwithstanding the foregoing, if (1) during the last 17 days of the Restricted Period the Company issues an earnings release or material news or a material event relating to the Company occurs; or (2) prior to the expiration of the Restricted Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the Restricted Period, the restrictions imposed by this Agreement shall continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event.  The Company shall promptly notify Morgan Stanley of any earnings release, news or event that may give rise to an extension of the initial Restricted Period.

 

3.                          Terms of Public Offering . The Company is advised by you that the Underwriters propose to make a public offering of their respective portions of the Shares as soon after the Registration Statement and this Agreement have become effective as in your judgment is advisable.  The Company is further advised by you that the Shares are to be offered to the public initially at $[ · ] a share (the “ Public Offering Price ”) and to certain dealers selected by you at a price that represents a concession not in excess of $[ · ] a share under the Public Offering Price, and that any Underwriter may allow, and such dealers may reallow, a concession, not in excess of $[ · ] a share, to any Underwriter or to certain other dealers.

 

4.                          Payment and Delivery .  Payment for the Firm Shares shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Firm Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on [ · ], 2011, or at such other time on the same or such other date, not later than [ · ], 2011, as shall be designated in writing by you.  The time and date of such payment are hereinafter referred to as the “ Closing Date .”

 

Payment for any Additional Shares shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Additional Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on the date specified in the corresponding notice described in Section 2 or at such other time on the same or on such other date, in any event not later than [ · ], 2011, as shall be designated in writing by you.

 

The Firm Shares and Additional Shares shall be registered in such names and in such denominations as you shall request in writing not later than one full business day prior to the Closing Date or the applicable Option Closing Date, as the case may be.  The Firm Shares and Additional Shares shall be delivered to you on the Closing Date or an Option Closing Date, as the case may be, for the

 

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respective accounts of the several Underwriters.  The Purchase Price payable by the Underwriters shall be reduced by (i) any transfer taxes paid by, or on behalf of, the Underwriters in connection with the transfer of the Shares to the Underwriters duly paid and (ii) any withholding required by law.

 

5.                          Conditions to the Underwriters’ Obligations . The obligations of the Company to sell the Shares to the Underwriters and the several obligations of the Underwriters to purchase and pay for the Shares on the Closing Date are subject to the condition that the Registration Statement shall have become effective not later than [ · ] (New York City time) on the date hereof.

 

The several obligations of the Underwriters are subject to the following further conditions:

 

(a)                               Subsequent to the execution and delivery of this Agreement and prior to the Closing Date:

 

(i)                    there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any of the securities of the Company by any “nationally recognized statistical rating organization,” as such term is defined for purposes of Rule 436(g)(2) under the Securities Act; and

 

(ii)                 there shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus as of the date of this Agreement that, in your judgment, is material and adverse and that makes it, in your judgment, impracticable to market the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus.

 

(b)                              The Underwriters shall have received on the Closing Date a certificate, dated the Closing Date and signed on behalf of the Company by an executive officer of the Company, to the effect set forth in Section 5(a)(i) above and to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date.

 

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The officer signing and delivering such certificate may rely upon his or her knowledge as to proceedings threatened.

 

(c)                          The Underwriters shall have received on the Closing Date an opinion of Winston & Strawn LLP, outside counsel for the Company, dated the Closing Date, in the form attached hereto as Exhibit B.

 

(d)                         The Underwriters shall have received on the Closing Date an opinion of DLA Piper LLP (US), counsel for the Underwriters, dated the Closing Date, in form and substance satisfactory to the Underwriters.

 

With respect to Sections 6(c) and (d) above, Winston & Strawn LLP and DLA Piper LLP (US) may state that their opinions and beliefs are based upon their participation in the preparation of the Registration Statement, the Time of Sale Prospectus and the Prospectus and any amendments or supplements thereto and review and discussion of the contents thereof, but are without independent check or verification, except as specified.

 

The opinion of Winston & Strawn LLP described in Section 6(c) above shall be rendered to the Underwriters at the request of the Company and shall so state therein.

 

(e)                          The Underwriters shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Underwriters, from Ernst & Young LLP, independent registered public accounting firm, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement, the Time of Sale Prospectus and the Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off date” not earlier than the date hereof.

 

(f)                            The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between you and each officer and director, certain holders of shares of the capital stock of the Company and certain holders of options to purchase shares of the capital stock of the Company, delivered to you on or before the date hereof, shall be in full force and effect on the Closing Date.

 

The several obligations of the Underwriters to purchase Additional Shares hereunder are subject to the delivery to you on the applicable Option Closing Date of such documents as you may reasonably request with respect to the good standing of the Company, the due authorization and issuance of the Additional

 

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Shares to be sold on such Option Closing Date and other matters related to the issuance of such Additional Shares.

 

6.                     Covenants of the Company . The Company covenants with each Underwriter as follows:

 

(a)                     To furnish to you, without charge, three (3) signed copies of the Registration Statement (including exhibits thereto) and for delivery to each other Underwriter a conformed copy of the Registration Statement (without exhibits thereto) and to furnish to you in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding the date of this Agreement and during the period mentioned in Section 6(e) or 6(f) below, as many copies of the Time of Sale Prospectus, the Prospectus and any supplements and amendments thereto or to the Registration Statement as you may reasonably request.

 

(b)                    Before amending or supplementing the Registration Statement, the Time of Sale Prospectus or the Prospectus, to furnish to you a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which you reasonably object, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.

 

(c)                     To furnish to you a copy of each proposed free writing prospectus to be prepared by or on behalf of, used by, or referred to by the Company and not to use or refer to any proposed free writing prospectus to which you reasonably object.

 

(d)                    Not to take any action that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not have been required to file thereunder.

 

(e)                     If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in the light of the circumstances, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement then on file, or if, in the reasonable opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with

 

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applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when the Time of Sale Prospectus is delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.

 

(f)                       If, during such period after the first date of the public offering of the Shares as in the reasonable opinion of counsel for the Underwriters the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is required by law to be delivered in connection with sales by an Underwriter or dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, not misleading, or if, in the reasonable opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses you will furnish to the Company) to which Shares may have been sold by you on behalf of the Underwriters and to any other dealers upon reasonable request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law.

 

(g)                    During the Restricted Period, (i) to enforce all existing agreements between the Company and any of its security holders that prohibit the sale, transfer, assignment, pledge or hypothecation of any of the Company’s securities in connection with the Company’s initial public offering, (ii) direct the transfer agent to place stop transfer restrictions upon any such securities of the Company that are bound by such existing “lock-up” or market standoff agreements for the duration of the periods contemplated in such agreements and (iii) not release or otherwise grant any waiver of such agreements without the prior written consent of Morgan Stanley, except in the case of each of (i), (ii) and (iii) above the Company shall be permitted to repurchase or cancel any of the Company’s securities for the sole purpose of payment of taxes required in connection with the vesting of any restricted stock units outstanding on the date hereof.

 

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(h)                    To endeavor to qualify the Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions as you shall reasonably request; provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction or (ii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.

 

(i)                        To make generally available to the Company’s security holders and to you as soon as practicable an earnings statement covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.

 

7.                          Expenses .  Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, the Company agrees to pay or cause to be paid all expenses incident to the performance of their obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s counsel and the Company’s accountants in connection with the registration and delivery of the Shares under the Securities Act and all other fees or expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or other taxes payable thereon, (iii) the reasonable cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Shares under state securities laws and all expenses in connection with the qualification of the Shares for offer and sale under state securities laws as provided in Section 6(h) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (iv) all filing fees and the reasonable fees and disbursements of counsel for the Underwriters incurred in connection with the review and qualification of the offering of the Shares by FINRA (provided that the fees and disbursements of counsel for the Underwriters incurred pursuant to subsections (iii) and (iv) shall not exceed $40,000), (v) all fees and expenses in connection with the preparation and filing of the registration statement on Form 8-A relating to the Class A Common Stock and all costs and expenses incident to listing the Shares on the NASDAQ Global Select Market and other national securities

 

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exchanges and foreign stock exchanges, (vi) the cost of printing certificates representing the Shares, (vii) the costs and charges of any transfer agent, registrar or depositary, (viii) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Shares, including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives and officers of the Company and any such consultants, and 50% of the cost of any aircraft chartered in connection with the road show (the remaining 50% of the cost of such aircraft to be paid by the Underwriters), (ix) the document production charges and expenses associated with printing this Agreement, and (x) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section 7.  It is understood, however, that except as provided in this Section 7, Section 9 entitled “Indemnity and Contribution,” and Section 11(b) below, the Underwriters will pay all of their costs and expenses, including fees and disbursements of their counsel, stock transfer taxes payable on resale of any of the Shares by them, any advertising expenses connected with any offers they may make, and travel and lodging expenses incurred by them in connection with any “road show”.

 

8.                          Covenants of the Underwriters .  Each Underwriter severally covenants with the Company not to take any action that would result in the Company being required to file with the Commission under Rule 433(d) a free writing prospectus prepared by or on behalf of such Underwriter that otherwise would not be required to be filed by the Company thereunder, but for the action of the Underwriter.

 

9.                          Indemnity and Contribution .  (a) The Company agrees to indemnify and hold harmless each Underwriter, each person, if any, who controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, and each affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, or the Prospectus or any amendment or supplement thereto, or caused by any omission or alleged omission

 

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to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages or liabilities are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein.

 

(b)                    Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, the directors of the Company, the officers of the Company who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, or the Prospectus (as amended or supplemented if the Company shall have furnished any amendments or supplements thereto), or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, but only with reference to information relating to such Underwriter furnished to the Company in writing by such Underwriter through you expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus or the Prospectus or any amendment or supplement thereto.

 

(c)                     In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 9(a) or 9(b), such person (the “ indemnified party ”) shall promptly notify the person against whom such indemnity may be sought (the “ indemnifying party ”) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the reasonably incurred fees and disbursements of such counsel related to such proceeding.  In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed in writing to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include

 

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both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them.  It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in the same jurisdiction, be liable for (i) the fees and expenses of more than one separate firm (in addition to any local counsel) for all Underwriters and all persons, if any, who control any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act or who are affiliates of any Underwriter within the meaning of Rule 405 under the Securities Act, and (ii) the fees and expenses of more than one separate firm (in addition to any local counsel) for the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either such Section, and that all such fees and expenses shall be reimbursed as they are incurred.  In the case of any such separate firm for the Underwriters and such control persons and affiliates of any Underwriters, such firm shall be designated in writing by Morgan Stanley. In the case of any such separate firm for the Company, and such directors, officers and control persons of the Company, such firm shall be designated in writing by the Company.  The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment.  Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 60 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement.  No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party.

 

(d)                    To the extent the indemnification provided for in Section 9(a) or 9(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party

 

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under such Section, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party or parties on the other hand from the offering of the Shares or (ii) if the allocation provided by clause 9(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 9(d)(i) above but also the relative fault of the indemnifying party or parties on the one hand and of the indemnified party or parties on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations.  The relative benefits received by the Company on the one hand and the Underwriters on the other hand in connection with the offering of the Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Shares (before deducting expenses) received by the Company and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate Public Offering Price of the Shares.  The relative fault of the Company on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.  The Underwriters’ respective obligations to contribute pursuant to this Section 9 are several in proportion to the respective number of Shares they have purchased hereunder, and not joint.

 

(e)                     The Company and the Underwriters agree that it would not be just or equitable if contribution pursuant to this Section 9 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 9(d).  The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 9(d) shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.  Notwithstanding the provisions of this Section 9, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.  No person guilty of fraudulent

 

23



 

misrepresentation (within the meaning of Section 11(e) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.  The remedies provided for in this Section 9 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

 

(f)                       The indemnity and contribution provisions contained in this Section 9 and the representations, warranties and other statements of the Company contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter, any person controlling any Underwriter or any affiliate of any Underwriter, or the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Shares.

 

10.                    Termination .  The Underwriters may terminate this Agreement by notice given by you to the Company, if  after the execution and delivery of this Agreement and prior to the Closing Date (i) trading generally shall have been suspended or materially limited on, or by, as the case may be, any of the New York Stock Exchange, the American Stock Exchange, the NASDAQ Global Select Market, the Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a material disruption in securities settlement, payment or clearance services in the United States shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by Federal or New York State authorities or (v) there shall have occurred any outbreak or escalation of hostilities, or any change in financial markets or any calamity or crisis that, in your judgment, is material and adverse and which, singly or together with any other event specified in this clause (v), makes it, in your judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus or the Prospectus.  Notwithstanding anything in this Agreement to the contrary, if this Agreement is terminated pursuant to clauses (iii), (iv) or (v) of this Section 10, then the obligations of the Company to reimburse the expenses of the Underwriters set forth in clauses (iii) and (iv) of Section 9 of this Agreement are also terminated and of no further effect.

 

11.                    Effectiveness; Defaulting Underwriters .  This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.

 

(a)                     If, on the Closing Date or an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase Shares

 

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that it has or they have agreed to purchase hereunder on such date, and the aggregate number of Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Shares to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the number of Firm Shares set forth opposite their respective names in Schedule I bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as you may specify, to purchase the Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the number of Shares that any Underwriter has agreed to purchase pursuant to this Agreement be increased pursuant to this Section 11 by an amount in excess of one-ninth of such number of Shares without the written consent of such Underwriter.  If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be purchased, and arrangements satisfactory to you and the Company for the purchase of such Firm Shares are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter or the Company.  In any such case either you or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement, in the Time of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected.  If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such Option Closing Date, the non-defaulting Underwriters shall have the option to (i) terminate their obligation hereunder to purchase the Additional Shares to be sold on such Option Closing Date or (ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to purchase in the absence of such default.  Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.

 

(b)                    If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company shall be unable to perform its obligations under this Agreement (which, for purposes of this Section 11, shall not include termination by the Underwriters under items (iii), (iv) or (v) of Section 12), the Company will reimburse the Underwriters or such Underwriters as have so terminated this

 

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Agreement with respect to themselves, severally, for all out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder.

 

12.                    Entire Agreement .  This Agreement, together with any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this Agreement) that relate to the offering of the Shares, represents the entire agreement between the Company, on the one hand, and the Underwriters, on the other, with respect to the preparation of any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Shares.

 

The Company acknowledges that in connection with the offering of the Shares:  (i) the Underwriters have acted at arms length, are not agents of, and owe no fiduciary duties to, the Company or any other person, (ii) the Underwriters owe the Company only those duties and obligations set forth in this Agreement and prior written agreements (to the extent not superseded by this Agreement), if any, and (iii) the Underwriters may have interests that differ from those of the Company.  The Company waives to the full extent permitted by applicable law any claims it may have against the Underwriters arising from an alleged breach of fiduciary duty in connection with the offering of the Shares.

 

13.                    Counterparts .  This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

 

14.                    Applicable Law .  This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York.

 

15.                    Headings .  The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.

 

16.                    Notices.  All communications hereunder shall be in writing and effective only upon receipt, and:

 

(a)                     if to the Underwriters shall be delivered, mailed or sent to you in care of Morgan Stanley & Co. LLC, 1585 Broadway, New York, New York 10036, Attention: Equity Syndicate Desk, with a copy to the Legal Department; Goldman, Sachs & Co., 200 West Street, New York, New York 10282; and

 

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(b)                    if to the Company shall be delivered, mailed or sent to Groupon, Inc., 600 West Chicago Avenue, Suite 620, Chicago, Illinois 60654, Attention: David R. Schellhase, Esq.; with a copy to Winston & Strawn LLP, 35 West Wacker Drive, Chicago, Illinois 60601, Attention: Steven J. Gavin and Matthew F. Bergmann.

 

 

 

Very truly yours,

 

 

 

Groupon, Inc.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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Accepted as of the date hereof:

Acting severally on behalf of themselves and the several Underwriters named in Schedule I hereto:

 

By:

Morgan Stanley & Co. LLC

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

By:

Goldman, Sachs & Co.

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

By:

Credit Suisse Securities (USA) LLC

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

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SCHEDULE I

 

Underwriter

 

Number of Firm Shares

To Be Purchased

 

 

 

 

 

Morgan Stanley & Co. LLC

 

 

 

Goldman, Sachs & Co.

 

 

 

Credit Suisse Securities (USA) LLC

 

 

 

 

 

 

 

Total:

 

 

 

 



 

SCHEDULE II

 

Time of Sale Prospectus

 

1.                                        Preliminary Prospectus issued [date]

 

2.                                        [identify all free writing prospectuses filed by the Company under Rule 433(d) of the Securities Act]

 

3.                                        [free writing prospectus containing a description of terms that does not reflect final terms, if the Time of Sale Prospectus does not include a final term sheet]

 

4.                                        [orally communicated pricing information such as price per share and size of offering if a Rule 134 pricing term sheet is used instead of a filed free writing prospectus]

 

II-1